Wednesday, 29 May 2013

According to my membership card, I first joined the American Bar Association in 1976. I was a first year associate at one of the large firms in Houston. A lot has changed about the practice of law since then. And like every other facet of life, not only is more change ensured, but the pace of change seems almost certain to increase as well.

For those who have checked in on this spot over the last decade, you know that one trend I noted early in the days of this blog and have been following is the possibility of a cause of action for bullying. I have gone from disbelief that it could ever happen, to now being resigned to the inevitability. It is only at the inception, but another trend I have begun to notice is the one I wrote about just one month ago, A Ground Floor Opportunity? Litigation Finance. Ted Siedle, the ex-SEC lawyer featured in the above article is taking a slight variant of the same sort of approach. In his case, seeking public financing to fund investigations that could lead to SEC awards under its whistleblower program. In the early years, an article in The Lawyer's Magazine, on raising money to initiate more litigation would more likely have talked about barratry, or some other pejorative term, rather than innovation. But of course that was when lawyering was a profession, not a business. Bob Dylan nailed it:

Tuesday, 21 May 2013

Although as an object fact we know that it is important when the Supreme Court issues a decision, see my discussion just above about the importance of a SOX case that will be decided next term, but it never hurts to be reminded.

Although the result might have been the same regardless of Staub, that's not what it sounds like. The case involved two LSU police officers vying for the Chief's job. The male not only got the interim position, but also the ear of the Chancellor. Even though the Chancellor made the decision to select him, not Ms. Haire, the actions of the interim male Chief, were what made the difference, at least according to Judge Jolly who wrote for the majority.

And on the Supreme Court docket for next term after the Court's grant of certiorai of a 1st Circuit decision which applied a narrow definition to the coverage of the first major financial regulatory act. Lawson v. FMR, LLC. (1st Cir. 2.3.12) . The case's page on Scotus blog is here.

The dispute involves the basic question of what employees are covered by SOX. The Court highlighted the disputed language:

Whistleblower protection for employees of publicly traded companies. — No company with a class of securities registered under section 12 of the Securities Exchange Act of 1934 (15 U.S.C. § 781), or that is required to file reports under section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. § 78o(d)), or any officer, employee, contractor, subcontractor, or agent of such company, may discharge, demote, suspend,threaten, harass, or in any other manner discriminateagainst an employee in the terms and conditions of employment because of any lawful act done by the employee —

The parties presented two differing arguments for the meaning: (1) FMR argued only employees of publicly held companies are covered, and the highlighted language means that they are protected against actions from any of the highlighted individuals; (2) the individuals who worked for private companies that contract to act as advisers and managers to publicly held companies, argue that coverage extends not only to employees of publicly held companies, but to the "employees those public companies' officers, employees, contractors, subcontractors, or agent." The First Circuit in a 2-1 decision chose the first, more narrow option.

The scope of the two is dramatically different. Hopefully someone with access to a lot of data will tell us how different, but I would bet that it would if the Supreme Court adopts the broader reading at least 10 times more employees will be covered, and that guess could be off by magnitudes of tens or even hundreds.

A narrow reading would normally be subject to congressional change, but given the current state of affairs in Congress, it is highly unlikely that any such change would happen any time soon. (Although I will admit strange things do happen to move legislation at times.)

But as of today, the Supreme Court's docket for next term got a lot more important for employment lawyers.

Tuesday, 7 May 2013

Today, the D.C. Circuit struck down the NLRB's rule which required all employers over which it had jurisdiction to post a notice advising employees of their rights under the NLRA. National Association of Manufacturers v. NLRB(D.C. Cir. 5.7.13). The majority opinion relied primarily on Section 8(c), the so called "free speech" provision which allows employers to advise employees of their view on unions as long as it is done in a non-coercive manner.

It was a unanimous decision, with two judges concurring only to point out that in their view there was yet another independent basis to strike the rule down.

And with the majority opinion quoting opinions authored by Chief Justice Roberts and Justice Scalia (and referring to a Justice Thomas concurrence), it is clear that the Court was writing not only for today, but for the anticipated appeal.

In the more than 35 years I have been practicing, I can not remember a time when an agency that was involved in regulating the workplace has been in such disarray. It is hard to see a path to normalcy, and sometimes hard to remember even what that is when speaking of the Board.

Whether in the long term that is a good or bad thing is not yet clear; but that it is taking us to uncharted waters is a certainty.

Thursday, 2 May 2013

The EEOC last year issued some updated guidance on Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII. It laid out a blue print for how to plead a case under Title VII using the disparate impact theory of discrimination. Although not as common as disparate treatment cases, disparate impact cases tend to have much broader application because one of the requirements is a business practice that is applied uniformly with a disparate impact on a protected category.

Waldon v. Cincinnati Public Schools (S.D. Ohio, 4.24.13) may not be the first case, but it is the first one I have seen where a plaintiff has followed the EEOC's invitation and at least gotten through an initial motion to dismiss.

As on all employment law issues that arise in Ohio, Jon Hyman has a good look at the case here, focusing on the dilemma where an employer has a federal mandate and state statute (in this case H.B. 190) that appear to conflict.

His prediction (or at least hope) is that following state law will meet the exculpatory requirement of business necessity. Maybe Waldon will give us the answer as it progresses, but it is clear that until that issue is definitively resolved there are going to be a number of employers facing tough choices.

But there are many employers who may find themselves having to defend similar actions without even the argument that they are protected by a need to comply with state law. Projecting hot areas of litigation is risky business, but if I had to bet, this is one area I would certainly be looking at.